CHAP3 (PowerPoint)

							c h a p t e r

3
      INFORMATION
        SYSTEMS,
     ORGANIZATIONS,
      MANAGEMENT,
      AND STRATEGY
    Quick Review of Ch. 2
• 2 dimensions IS systems
• 6 types of IS
• Which provides data for the most
  other IS?
• Structured decision?
• 5 qualities of Information?
  – Richness
  – Reach
  – Asymmetry
      Things of Interest in Ch. 3
•   Value chain analysis (H & R Block)
•   Porter forces model
•   Organization’s relationship with IS
•   Theories relating to IS impacts
•   Org. Structures / IS Implications
•   Value Chain
•   Supply Chain
  I believe, IS technology does not
 give an organization a sustainable
               advantage.

• A sustainable advantage (if
  possible) requires the use of IS
  technology to change the
  structure of the organization
  and it’s position with it’s market
  and suppliers.
 ORGANIZATIONS & INFORMATION
  TECHNOLOGY RELATIONSHIP




ORGANIZATIONS         INFORMATION
                      TECHNOLOGY
 ORGANIZATIONAL STRUCTURES
  • ENTREPRENEURIAL: Start up business
  • MACHINE BUREAUCRACY: Mid-sized
    manufacturing firm
  • DIVISIONALIZED BUREAUCRACY:
    Fortune 500
  • PROFESSIONAL BUREAUCRACY: Law
    firms, hospitals
  • ADHOCRACY: Consulting firm
  • MATURE HITECH: Entrepreneurs make the
    jump to management: e.g., OSITECH, RIM,
    Billy G.
3.7                    *
    Entrepreneurial Structure
•   Driven by an Entrepreneur(s)
•   Personnel: Young, energetic
•   Firm small in size
•   Sometimes managed by a single CEO
•   Operate in a fast changing market
•   IS typically poorly planned, adhoc
      Machine Bureaucracy
• Operates in slow changing environment
  (at least perceived that way).
• Produces standardized products.
• Dominated by centralized senior
  management.
• Usually organized into functional units,
  e.g., production, marketing, payroll.
• Well planned IS (usually in accounting
  area).
   Professional Bureaucracy
• Based on Knowledge of Professionals.
• Managed by department heads and have
  weak centralized authority.
• Primitive centralized IS system usually
  for billing.
• May have knowledge support systems.
• Example: Law firms, Doctor office
 Divisonalized Bureaucracy
• Most common to Fortune 500 Co.
• Combination of many Machine
  Bureaucracies.
• Organization suited to slow moving
  environment.
• IS systems elaborate and complex.
         Adhocracy
• Task force organization.
• More innovative than Machine
  Bureaucracy and flexible than
  Professional Bureaucracy.
• Weak central management.
• Very advanced in areas of Organization.
• E.g., electronic firms, aerospace, high
  tech firms.
   David’s Mature High Tech
• Matured Entrepreneurial Organization.
• Entrepreneur makes the switch to
  management.
• Upper management is technologically
  competent.
• Large functional groups (like Adhocracy)
  are technically competent.
  POINTS TO REMEMBER
• Organizational change is slower than
  technology change.
• Organizations will resist all but the
  most basic changes.
• The environment changes faster than
  organizations.
• Technology can help or destroy a
  company (if they fail to change):
  Opportunity or threat?
Achieving a Competitive Advantage
     IS as a Strategic Weapon




    Many strategic moves can work together to achieve a competitive
                             advantage
     THE COMPUTER PERSONELLE

INFORMATION SPECIALISTS:
•   IS Managers
•   Systems analysts
•   Programmers
•   Maintenance programmers
•   Database administrators
                    *
  HOW INFO SYSTEMS AFFECT
       ORGANIZATIONS
 • MICROECONOMIC THEORY: Info
   technology is a factor of production,
   like capital & labor
 • TRANSACTION COST THEORY:
   Firms attempt to minimize
   transaction costs internally &
   externally                        CEO

                      *
3.27                             VP   VP   VP
  HOW INFO SYSTEMS AFFECT
       ORGANIZATIONS
  • AGENCY THEORY: Firm is nexus of
    contracts among agents who make
    decisions; IS shrink number of
    agents & reduce cost
  • BEHAVIORAL THEORIES: Concepts
    from Sociology, Psychology, Political
    Science; Organizations & Information
                                     CEO
    Technology mutually influence each
3.28other                         VP VP     VP
     What is a Supply Chain?

“A supply chain consists of all stages
 involved, directly or indirectly, in fulfilling
 a customer request”

It includes: raw material providers,
   manufactures, warehouses, retailers,
   customers etc.

Glass of Milk at the cafeteria?
    Value Chains Analysis


The way of organizing and determining the
 value added activities that each strategic
 business unit undertakes to design,
 produce, promote, market, deliver and
 support the products or services it sells.
  3. INFORMATION SYSTEMS,
       ORGANIZATIONS, &
    BUSINESS PROCESSES




3.34